Correlation Between Air Lease and TSOGO SUN
Can any of the company-specific risk be diversified away by investing in both Air Lease and TSOGO SUN at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Air Lease and TSOGO SUN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and TSOGO SUN GAMING, you can compare the effects of market volatilities on Air Lease and TSOGO SUN and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Air Lease with a short position of TSOGO SUN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and TSOGO SUN.
Diversification Opportunities for Air Lease and TSOGO SUN
Excellent diversification
The 3 months correlation between Air and TSOGO is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and TSOGO SUN GAMING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TSOGO SUN GAMING and Air Lease is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Air Lease are associated (or correlated) with TSOGO SUN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TSOGO SUN GAMING has no effect on the direction of Air Lease i.e., Air Lease and TSOGO SUN go up and down completely randomly.
Pair Corralation between Air Lease and TSOGO SUN
Assuming the 90 days trading horizon Air Lease is expected to generate 2.15 times less return on investment than TSOGO SUN. But when comparing it to its historical volatility, Air Lease is 2.44 times less risky than TSOGO SUN. It trades about 0.05 of its potential returns per unit of risk. TSOGO SUN GAMING is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 32.00 in TSOGO SUN GAMING on September 13, 2024 and sell it today you would earn a total of 23.00 from holding TSOGO SUN GAMING or generate 71.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Lease vs. TSOGO SUN GAMING
Performance |
| Timeline |
| Air Lease |
| TSOGO SUN GAMING |
Air Lease and TSOGO SUN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Lease and TSOGO SUN
The main advantage of trading using opposite Air Lease and TSOGO SUN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease position performs unexpectedly, TSOGO SUN can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in TSOGO SUN will offset losses from the drop in TSOGO SUN's long position.| Air Lease vs. United Rentals | Air Lease vs. WillScot Mobile Mini | Air Lease vs. Superior Plus Corp | Air Lease vs. SIVERS SEMICONDUCTORS AB |
| TSOGO SUN vs. Sands China | TSOGO SUN vs. Superior Plus Corp | TSOGO SUN vs. SIVERS SEMICONDUCTORS AB | TSOGO SUN vs. Norsk Hydro ASA |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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